How much tax you pay on a let flat, and when actual expenses beat the flat rate

Rental income tax in Czechia in 2026 is 15 % of the rent minus expenses (§ 9 and 16 of the Income Tax Act). You deduct either flat-rate expenses of 30 % of income, at most CZK 600,000, or actual costs including mortgage interest and depreciation. On a flat let at CZK 22,000 a month, the tax is CZK 27,720 a year at the flat rate, or about CZK 1,100 in year one with actual costs and a mortgage.

The return for 2026 is due by 1 April 2027, a month later if you file electronically, and by 1 July 2027 with a tax adviser. You choose between the flat rate and actual expenses each year in the return, and the choice cannot be changed afterwards.

How much tax do you pay on rental income in Czechia?

Rent from a flat is rental income under § 9 of the Income Tax Act. You subtract expenses from the income, and the result, the partial tax base (dílčí základ daně), is added to your other income, such as a salary. The rate is 15 % up to 36 times the average wage and 23 % on the part above it (§ 16).

If the rent comes from the spouses' community property, only one of them pays tax on it (§ 9(2)). An employee who has signed the taxpayer's declaration (prohlášení poplatníka) at work may skip the return only if their other income stays within CZK 20,000 a year (§ 38g). Rent of CZK 22,000 a month crosses that line in the first month.

Should you claim the 30 % flat rate or actual expenses?

The flat rate is simple: you deduct 30 % of the income, at most CZK 600,000, and keep records only of income and receivables. It covers every cost connected with the letting, however, so you cannot claim anything else alongside it. Actual expenses mean keeping records of income, costs and depreciated assets, but on a mortgaged flat they tend to be far higher than the flat rate.

The deduction of up to CZK 150,000 of interest a year under § 15 is for your own housing only, and the law expressly excludes a flat that is let. Here the interest works as an expense instead, and only if you do not use the flat rate. Other taxes that touch a mortgaged flat, from purchase to sale, are summarised in mortgage and taxes.

How do you depreciate a flat you let?

For income tax a flat is tangible property, and residential units fall into depreciation group 5 with a 30-year period. With straight-line depreciation you can claim at most 1.4 % of the input price in the first year and 3.4 % in each later year (§ 30 and 31 and the annex to the act).

• The input price is the acquisition price of the flat without the part of the unit that is land (§ 29). The value of your share in the land therefore has to be set separately.
• For a flat bought more than 5 years before the letting starts, you depreciate from the replacement cost (reprodukční pořizovací cena), set under the Property Valuation Act when the letting begins.
• Claiming depreciation is optional and you may pause it, then carry on as if there had been no break. In years with the flat rate, though, it runs on paper only, and the depreciation period is not extended by those years (§ 26).
• A loss on the letting created by a large depreciation charge cannot be set against your salary. It reduces only the other partial tax bases under § 7 to 10 and can be carried forward for the next 5 years (§ 5 and 34).
• When the sale of the flat is taxable, for example within 10 years of purchase, you deduct from the proceeds only the residual tax value, i.e. the input price minus depreciation, including the paper depreciation from flat-rate years (§ 10 and 29).

The numbers on a mortgaged flat

What is left after the mortgage payment, costs and tax is calculated by the Rental yield calculator. Banks treat a loan for a flat to let as a buy-to-let mortgage, and since 1 April 2026 the ČNB has recommended an LTV of at most 70 % for it.

Do you pay tax on a small rental income?

You do. The exemption of up to CZK 50,000 a year covers occasional activities and the occasional rental of movable things, such as a car or equipment (§ 10). Rent from a flat is always income under § 9 and has no exemption threshold.

What differs is only whether you must file a return. An employee with a signed declaration files once their other income exceeds CZK 20,000 a year. Someone with no other taxable income files only when annual income exceeds CZK 50,000 (§ 38g). So an employee with rent of CZK 50,000 a year pays, at the flat rate, 15 % of CZK 35,000, which is CZK 5,250.

Short-term letting and VAT

Long-term letting of a flat is exempt from VAT (§ 56a of the VAT Act), so the landlord charges no output tax. The rent does count towards the turnover for compulsory registration (§ 4a), however, and anyone whose rents and other supplies exceed CZK 2,000,000 a year becomes a VAT payer.

The exemption does not apply to letting for 48 hours or less, or to accommodation services. Letting a flat is not in itself a trade (§ 3 of the Trade Licensing Act), whereas accommodation services are an unregulated trade (volná živnost). If you arrange cleaning and linen for guests who change regularly, you are usually no longer taxing rent under § 9 but business income under § 7. Where the line runs and what it means for your mortgage is covered in the article on when a mortgaged flat may be offered for rent through Airbnb.